Decrease in Global Venture Capital Investments From Previous Quarter
Image by Shutterstock.com
According to data from Crunchbase, the second quarter of 2023 showed a significant decrease in global venture capital investments (VCI), recording a drop of 18% from the previous quarter to settle at USD 65 billion, and his decline is especially noticeable when compared to the funding in Q2 2022, where investors funneled an impressive USD 127 bln into startups, resulting in a significant 49% decrease.
The first quarter of 2023 was significantly influenced by investments in OpenAI and Stripe, investments of USD 10 bln and USD 6.5 bln, respectively. Accounting for these momentous deals within the first quarter, statistics predicted a remarkable 14% quarter-over-quarter rise in funding for the second quarter of 2023, rather than the decrease it currently portrays.
Annually, deal volumes have shrunk by 37%, with each investment stage experiencing a drop of over a third. In the last quarter, over 6,000 startups managed to secure funding, marking a noticeable dip from the over 9,500 startups that achieved this during the same period in the prior year.
Building on KPMG’s findings, there is an assumption that European investments followed a cautious approach, with USD 13.5 bln funneled over 1861 transactions.
The spotlight in Europe during Q2 2023 was on AI and deep learning technologies, such as the U.K.-based Quantexa, which garnered a substantial investment of USD 129 million during this period, thereby earning unicorn status.
VCIs in Europe continue to exercise caution in their investment decisions. Current market dynamics and worries about future fundraising opportunities have contributed to this cautious stance. Additionally, it's projected that exit activity will be less vibrant, as both startups and investors opt for a more patient approach, awaiting better market sentiment.
During Q2 2023, VCIs in CEE experienced a minor decrease, with investments slightly surpassing EUR 560 mln, a slight drop from Q1 2023 when startups landed more than EUR 600 mln. The trajectory signals a noticeable deceleration in the CEE VC market, which is nowhere close to the resilience it showed back in H1 2022, and illustrates a slight misalignment between CEE and the Western markets.
ADVERTISEMENT
MBH Bank Closes Acquisition of Duna Takarék Bank
V4 Agri Officials: WTO Case Over Grain Bans 'Unfortunate'
AutoWallis Green Investment Project Value Reaches HUF 3 bln
Budapest Muni Council Clears Rác Baths Renovation
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.
